Deutsche Börse AG

Welcome, ladies and gentlemen, and thank you for joining us today to review our financial results for the first quarter 2026. Present on today's call are Stephan Leithner, our Chief Executive Officer; and Jens Schulte, Chief Financial Officer.

Stephan and Jens will take you through the presentation. Following their remarks, we will open the line for your questions.

The presentation materials have been distributed by e-mail and are also available for download on our Investor Relations section of the website. This call is being recorded, and a replay will be made available shortly after the conclusion of today's session.

With that, let me now hand over to you, Stephan.

Thank you, Jan, and welcome, everyone. As the opening chart makes clear, Q1 was more than a good start.

It was a strong one. And it reflects the quality and resilience of what we have built.

Our structural growth drivers continue to deliver and accelerate, and our model benefited from a spike in volatility. Together, these dynamics put us well on track to reconfirm our ambitious full year outlook.

Let me therefore first comment on recent events and the resilience and performance of our operations. We have started the year in a market environment characterized by a sharp rise in geopolitical tensions, resurging inflation and rapidly shifting interest rate expectations, all of which drove a significant increase in market activity.

In this period of heightened volatility, we fulfilled our core mission, providing the trusted infrastructure that enables market participants to navigate turbulent markets with confidence. I want to explicitly, therefore, thank our employees whose dedication ensured our systems operated seamlessly and with exceptional resilience, handling new record volumes without an issue.

Turning to strategic momentum. The themes set out in our leading the transformation strategy are gaining momentum alongside geopolitical developments, and the world is moving increasingly in our direction.

Take digital assets and tokenization. We have been investing in this space for years, building regulated infrastructure, while others were still debating whether this was a real market.

That conviction is now being validated at scale across the Atlantic and increasingly across Asia. Digital assets are moving from the periphery to the mainstream of institutional finance, and we are not a late arrival to this story.

We are at the heart of it with the infrastructure, the regulatory standing and institutional client relationships to capture this opportunity as it now finally scales. A concrete expression of this strategic acceleration is our USD 200 million strategic investment in Kraken, combining Kraken's deep liquidity and crypto-native technology with our trusted market infrastructure, extensive institutional client network and regulatory expertise to create the secure and compliant gateway our clients are demanding.

And take our conviction on the European opportunity. The European Commission's Market Integration and Supervision Package is a landmark regulatory initiative that goes to the heart of what we do as the European champion.

Its ambition is clear. Reduce fragmentation in EU capital markets, strengthen European competitiveness, harmonize market supervision and enable modern technology adoption across financial market infrastructure.

All of these points play directly to our strengths. We have spent years building exactly the kind of integrated technology-enabled regulated market infrastructure that the MISP is designed to foster and promote.

We are not adapting to this agenda. We are already living it.

And as the leading Pan-European market infrastructure provider spanning trading, clearing, settlement and custody, we see ourselves as structurally very well placed to benefit from and actively shape this regulatory evolution. This is a conversation that is accelerating, and we intend to help shape its outcome.

Taken together, these are not coincidences. They are confirmations that the strategic moves we have made years ago and reconfirmed in December were the right ones, and that our competitive position is stronger today than it has ever been.

With that as a background, let me now take you through the highlights of this quarter. Six points I would like to highlight to you.

The first one, we delivered net revenue growth of 12% without treasury results. This performance was fueled by the powerful secular trends that form the backbone of our strategy, and I just highlighted, and it was amplified by heightened market activity in March.

The second point on this quarter is we demonstrated broad-based strengths across our portfolio, achieving double-digit net revenue growth without the treasury results in 5 of our 8 business areas. This mirrors our 2025 full year performance and is a testament to the exceptional balance of our portfolio.

What makes this particularly compelling is that the drivers of this growth are generally diverse. Yes, heightened market activity in March provided a tailwind for some of our businesses and our infrastructure is designed to capture exactly that.

But the majority of our growth this quarter was, again, structural in nature, rooted in long-term secular trends. Cyclical and secular growth are not an opposition in our model.

They reinforce each other. And a portfolio that can deliver double-digit growth across 5 business areas in different market conditions and for different underlying reasons is precisely the kind of resilience compounding growth engine we set out to build and that we are now delivering on.

Let me give you some examples. In Software Solutions, continued double-digit growth in annual recurring revenues was driven by our SaaS transformation and client wins.

I want to highlight, in particular, the SimCorp Global Summit that took place in Copenhagen last week, which was a powerful showcase of our investment management performance platform direction. We presented a concrete AI road map for SimCorp, covering how we are embedding AI across portfolio management, analytics and client workflows.

This is not a future ambition. It is a live program of delivery.

And more broadly on AI, we continue to make good internal progress across the group. We have particularly validated our thesis that the impact of AI on coding and therefore, productivity is material, allowing us to achieve more without our planned investment budget.

This is a structural efficiency gain that supports our operating leverage story and that we talked a lot about in London when we met in December. As a second highlight out of our portfolio mix.

In Fund Services, we are capitalizing on 2 powerful and reinforcing structural trends also this quarter. The industry-wide shift towards outsourcing of fund administration and the structural acceleration of capital markets-based old-age savings across Europe as more Europeans rely on capital markets to secure their retirement, demand for scalable, efficient fund infrastructure grows with it.

And we are a natural beneficiary of that trend. The result this quarter was new record levels of assets under custody as well as transactions, and it shows how the machine is working.

The third area I would like to elevate is Securities Services. With continued strong fixed income issuance and a significant uptick in retail investor activity, our custody and settlement volumes are at an all-time high.

So you've seen the breadth of our portfolio. That means for the third element I would really like to pinpoint for this quarter is that our treasury results inflected positively, reaching EUR 204 million.

This marks the first sequential increase since 2024 and was driven by higher cash balances at the beginning of the year. As we have previously communicated, we expect that the cyclical headwinds on the treasury results to subside, and this quarter's result is clear confirmation of that trend.

As a result of the 2 points I now highlighted, the fourth point is really that these factors combined to drive an accelerated all-in performance. Total net revenue grew 9% to EUR 1.64 billion in this quarter.

Importantly, our disciplined cost management translates this top line growth into even stronger bottom line performance. Total EBITDA increased by 10% to a new record of more than EUR 1 billion, a very special number in the first quarter, delivering a strong EBITDA margin of 61%.

This also means that the points I highlighted as a fifth element for the quarter and comment I would like to make is that the performance in the first quarter provides the right momentum for the rest of the year. You know us.

We remain disciplined and grounded in our assessments. We do not get carried away by a strong quarter, and we are mindful that the heightened market volatility that characterized March has since normalized.

Activity levels have moderated across most asset classes in April, and our guidance already assumes a more normalized trading environment for the remainder of the year. That said, our strong start puts us slightly ahead of our internal plan and the underlying structural drivers of our business remain firmly intact.

Based on these results and our outlook, we are reaffirming our ambitious full year 2026 guidance with confidence, but as always, with discipline. And that brings me to the last point, my sixth comment on the quarter that is turning to an update on Allfunds.

The acquisition remains firmly on track, following a strong and clear vote of support from Allfunds shareholders in the scheme of arrangement, we've initiated the customary pre-notification phase with the European Commission, an important procedural milestone that marks the beginning of the substantive review process. In parallel, we are actively pursuing all other merger control and regulatory approvals in the relevant jurisdictions.

All filings are progressing as planned, and we continue to expect completion of the transaction in the first half of 2027. I'm also pleased to note that Allfunds delivered a strong Q1 itself.

With net revenue, excluding net treasury income, growing by 10%. This further reinforces our conviction in the strategic and financial rationale for this combination.

I also want, in this context to acknowledge the sudden and tragic passing of Juan Alcaraz, the founder of Allfunds. Juan's vision and entrepreneurial drive built one of the world's most important fund distribution platforms.

And our thoughts are with his family, but also with the many colleagues at Allfunds that have a long history with him. He's a true leader and inspiration for the industry.

We look forward to lead that industry with the transaction completing early in 2027. Let me close with an update on our financial position and capital returns.

Our balance sheet is robust with our key rating metrics at year-end 2025 finishing better than expected, comfortably within our target ranges and providing significant financial flexibility. On capital returns, we remain fully committed to providing our shareholders with attractive and growing returns.

Our EUR 500 million share buyback program launched earlier this year is progressing well with approximately 42% of the total volume executed to date. And following shareholder approval at our AGM on May 13, we will pay a dividend of EUR 4.20 per share.

Also here, a strong sign of continuity and continued growth. All of this brings me to a simple conclusion.

Q1 was a strong start to 2026. We delivered broad-based growth, demonstrated operating leverage and executed decisively on our key strategic initiatives.

We are confident in our trajectory fully on track and committed to delivering on our goals. With that, I will hand over to Jens for a closer look at the financials.

Yes. Thank you very much, Stephan, and welcome, everyone.

So, it's a pleasure to talk you through our financial results for the first quarter of 2026. The 12% net revenue growth without the treasury results is precisely the kind of broad-based resilient performance that our business model is designed to deliver, fueled by continued underlying secular trends and heightened volatility in all asset classes in March.

This outcome powerfully validates the strategy we presented at our Capital Markets Day in December. Operating costs increased by 4% to EUR 626 million, but this included around EUR 13 million of exceptional costs relating to the Allfunds acquisition.

Excluding these, underlying operating cost growth on a constant currency basis amounted to 3%, driven by inflation and increased investments. This is in line with our guidance.

The result from financial investments, which was negative EUR 5 million, included a EUR 10 million impairment of a minority stake. The fact that our revenue growth is significantly outpacing the growth of our operating costs demonstrates the increasing profitability we're generating across the group.

We are engineering operating leverage for disproportionate EBITDA growth and shareholder returns, and this quarter clearly shows that the model is working as designed. Now let me turn to our segments, starting with Investment Management Solutions on Page 3.

Net revenue in the segment grew 5% to EUR 313 million or 10% on a constant currency basis. This is a meaningful distinction that reflects the ongoing strength of the underlying business.

Let me start with Software Solutions, which delivered another outstanding quarter. We achieved 16% annual recurring revenue growth in the first quarter, maintaining momentum from a strong 2025.

The Americas contributed 39% ARR growth, reflecting the continued penetration of the North American institutional market. Net revenue grew 15% year-on-year on a constant currency basis to EUR 168 million, the fourth consecutive quarter of double-digit growth.

On top of the continued expansion of our SaaS revenues, the quarter benefited from several EMEA renewals alongside the larger renewal with an American pension provider, significantly boosting license revenues. In the area of ESG & Index, headwinds from prolonged sales cycles and FX persist.

However, constant currency net revenue growth was 5%. As part of that, Index experienced significant growth with licensing revenue increasing by 15%.

Overall, the strong software solutions performance mitigated the known challenges in the ESG & Index business. EBITDA for the segment was impacted by the minority stake impairment I mentioned at the group level.

There was strong adjusted EBITDA growth of 18%, which is the right lens through which to assess the underlying operational performance of the segment. Now turning to Page 4.

We see that Trading & Clearing delivered an outstanding quarter. Net revenue without the treasury results grew 14% and EBITDA without the treasury results surged 22%.

This is a powerful demonstration of the operating leverage embedded in this business. The details tell a compelling story of broad-based strength across all product lines.

Financial derivatives was the standout performer with net revenue up 17%. In our fixed income business, revenues grew by 31% overall, with all 3 pillars of our business contributing strongly.

Revenues in our exchange traded fixed income derivatives increased by 26%, with March volumes surging to record levels. The main drivers were elevated geopolitical risk in the Middle East and the subsequent repricing of ECB policy expectations.

The performance of short-term interest rate derivatives was mixed in the quarter with market share under pressure from heightened competition. Nevertheless, open interest and active end clients more than doubled year-over-year, and still derivatives remain within the scope of the Active Account Requirement.

As the only full euro yield curve ecosystem, we remain focused on building sustainable market share and open interest. In OTC Clearing, revenues increased by 37% due to higher volumes and an increase in our market share to 24%.

However, the EU buy-side activation rate has only increased slightly to 18%. This means that more than 80% of onboarded clients are not yet active, underscoring the significant growth potential.

This is an opportunity, not a concern. In repo, revenues increased by 67% due to heightened market volatility and evolving regulatory demands.

Our equity derivatives business delivered a solid performance as well with net revenue up 9% in the quarter. This increase was not primarily due to higher volumes.

It was due to a higher quality. The increase in revenue was driven by favorable product mix and the benefits of pricing measures we implemented this year.

Commodities delivered another record quarter with net revenue up 14%, driven by record activity in Power and Gas, with gas mainly driven by certain derivatives. This exceptional performance was driven by a combination of factors that are unlikely to repeat with the same intensity in the near term.

We are already seeing a normalization of commodities volumes in Q2 as these market dynamics subside. The long-term secular growth drivers of our commodities business remain firmly intact.

These include Europe's ongoing energy transition, the continued shift of OTC trade into exchanges and our expanding global footprint. Cash equities trading was positively influenced by an increase in volatility and ongoing demand for both European equities and ETFs with net revenue up 9% and our FX business was mainly driven by currency volatility with average daily volumes crossing EUR 200 billion for the first time, a significant milestone that underscores the growing relevance of our platform.

I'm now moving to our Fund Services segment on Page 5. Net revenue without the treasury result grew 14% and EBITDA without the treasury result increased 18%, marking another quarter of strong double-digit growth in this business.

Fund processing revenues increased due to record levels of assets under custody and settlement activity. Fund distribution achieved further growth based on an increase in assets under distribution.

This performance is a direct result of our investments in our platform and our successful partnerships with global participants, these investments position us perfectly to capture the ongoing industry trend of outsourcing. Now turning to Securities Services on Page 6, which once again delivered an exceptional performance.

Net revenue without the treasury result grew 15%, while EBITDA without the treasury result increased 18%. Securities Services benefited from record levels of assets under custody, collateral management outstandings, and settlement activity.

This performance highlights Clearstream's essential role in the European financial market infrastructure Growth was broad-based and driven by continued fixed income issuance and elevated bond market volatility. High equity market levels and increased retail participation also contributed to this growth.

The 32% increase in collateral management outstandings is particularly noteworthy. Heightened demand for safe and efficient collateralization propelled our outstandings to a new record demonstrating the essential role our infrastructure plays in a dynamic market environment.

The treasury result was mainly affected by lower interest rates. However, as we noted at the group level, we are beginning to see an inflection point in the treasury result, and we expect this headwind to continue fading through 2026.

Now finally, let me conclude with our outlook for 2026. Given our good start to the year, we are reaffirming our ambitious guidance for 2026.

We are confident in our ability to achieve these targets, thanks to our sustained business momentum and continued secular growth trends. Although we saw a moderation in activity levels across most asset classes in April as the macro-driven volatility that characterized March normalized, this is consistent with our expectations and our guidance assumes a more normalized trading environment for the rest of the year.

The treasury result for 2026 is now expected to exceed EUR 700 million. This reflects the positive development we saw in Q1 driven by higher cash balances and the changes in interest rate dynamics.

Regarding operating costs, we continue to expect a 3% increase in '26 excluding the exceptional costs related to the Allfunds acquisition. In March, we successfully completed a bond issuance to finance the buyout of the ISS STOXX minority stake held by General Atlantic.

The bond issuance reflected the strength of our credit profile and the confidence of debt capital markets and our strategy. As a result, we expect to see a EUR 5 million increase in our financial results per quarter starting in Q2 '26.

Today's results in a nutshell, we are delivering on our current plan. We have a clear path to sustained and profitable growth through '28, and this will all translate into strong returns for you, our shareholders.

That concludes our presentation. We look forward to your questions.

A question on securities and fund services. The margins custody look quite strong, and you mentioned more collateral management, more retail participation.

Just wondering whether the margin could be stronger for longer. And then linked to that treasury result, you upgraded the guidance.

Just to try to understand what are the assumptions in terms of central bank rates and also the volume dynamics you're seeing in cash balances?

Yes. Thank you, Benjamin, for the questions.

On the Clearstream question. I mean margin, as you know, is also -- I mean, a reflection of many things, of course, the growth but also the product mix.

So I would not basically extrapolate from the current quarterly level into the future, we shall see how that's further going to develop. I mean we gave a midterm outlook as part of the Capital Markets Day, and I think that trajectory is still very much intact.

And on the treasury results side, we are happy to share our assumptions. So we increased that particularly based on the rates outlook, not so much on the volumes, cash balances, volumes outlook.

And on the rates outlook, we essentially assume no rate cuts in the U.S. this year, contrary to what we may have expected before and a further rate hike in the Eurozone area, moving these rates slightly up.

And that together brings us to that guidance of above EUR 700 million.

Question on EEX. So clearly, there's been some strong progress during the call, you mentioned that there was a strong boost from the volatility, clearly.

But I was just wondering if you could unpack that a bit more in terms of giving us a bit more granularity in what's happening in each of the markets where you are in terms of market share of the OTC versus on exchange. If you could also maybe give us a bit more color in terms of the contribution from newer countries.

So what is the share of revenues coming from outside of Germany and France, perhaps? So that would be quite useful.

Thank you very much, Arnaud. So first of all, on the drivers behind that.

So basically, we have seen good growth in all of our submarkets in the EEX business, both on the power side, as you could see as well as on the gas side. On the power side, as you know, I mean, that's more driven by the derivatives side, two-thirds -- approximately two-thirds is derivatives driven.

We've, of course, seen significant impact of volatility there. And as we also alluded to some of that as we've started to moderate in April already.

And then on the gas side, that's more a spot market. And there, we've also had a good product mix in Q1 that also helped us basically moving the needle forward.

In terms of international setup, as we said, so I mean, basically, we are strong in the core -- I mean, apart from Germany in the core European area, we have the one market that we always highlight is Japan. In Japan, we are basically -- in terms of market share, we are the only large exchange playing.

It is contribution of a higher single-digit million euro amount on an annual basis that we currently see, but it's continuing to grow strongly. And then the other market that we are always flag that we are entering into, but here we are just in early preparations, is really the Brazilian side.

So long story short, I think a lot of growth from the core business. But as we said, that was also particularly driven by the situation and has somewhat moderated.

One on IMS, please. So quarter software -- software was up again, double digit.

Perhaps the growth was a touch softer compared to Q4. So I was wondering whether you could provide some color in terms of what sort of pipeline you see for the coming quarters?

And partially related to that, I was curious to hear from you on whether you think that the latest AI development might slow down a bit the sales cycle. For example, I'm thinking about those clients that are currently not outsourcing yet their back office and middle office and might decide to wait a little bit longer before they outsource because perhaps they wonder whether they can develop the tools in house?

That's my first question. And the second question is on the €STR contracts, and thanks for the color you provided, especially the €STR and the EMIR 3.

So these were two initiatives that were a key part of your fixed income road map. I noticed that you still have a pretty good market share of open interest in €STR, but your market share of volumes declined quite a bit relative to ICE.

Can you provide some color on why that is the case? And would you say that you still are expecting to monetize these just at a later date?

Can you provide some color on what the time line might look like?

Enrico, thank you very much for the question around SimCorp. First of all, I mean, we see continued strong momentum or the pipeline is starting to become more even over the quarters, but the business will remain back-end loaded.

There's no question. The growth of 16% in Q1 is something that we feel is an important sign of that continuity.

You will recall a year ago, we had -- we were still very much spike driven that Q1 was not so much growing or actually not growing at all. But that's very different.

So we have a good feeling as we move through the quarters, therefore. I think your question around AI and whether that's slowing sales cycle, it's not what we see.

I mean we see the pressure in the industry on our clients, the asset managers we see that the spreading of the word on the fantastic wins that SimCorp has had, it's really engaging with clients in a much different way from ever before. And it's very much vindicating also those strategic discussions that are not just a SimCorp but a wider Deutsche Borse conversation.

It's really exciting to see.

Good. And on the €STR side.

So first of all, I think you described it well, right? I mean where the market share on the open interest side is still solid on the trading side, it was relatively low in Q1.

We believe that, among other things, that has been an exceptional situation where in a very volatile environment, also there is a tendency to a home-based liquidity, if you wish. And so we assume that, that also has shifted trading in that quarter and impact of trading in that quarter, particularly significantly.

We still believe that the underlying drivers that we are pulling for increasing our market share midterm on this business are still intact. One is the Active Account Requirement.

We reflect that we are not yet there. The plan timing -- plan is still unchanged that by June of this year, essentially a first requirement needs to be fulfilled and we're working with our clients in getting there.

And we are also, by the way, of course, as we always say, we're also working with the regulators to see how they view the situation. And the other element is really continuing to work on our margining capabilities -- on cross margining capabilities and other things to attract further business from a product side.

So that's how I would comment on that.

And just to make sure I understood it correctly, when you say in a volatile environment, you tend to have home-based liquidity, you're saying that a lot of clients might have diverted their volumes to the U.S. and therefore to the benefit of some of your competitors over there relative to European players.

Yes. To -- I mean, basically to their respective home markets, it could be -- it could also be to ICE and to others.

Just got a question on Allfunds and the time line for that. I know we expected the closing H1 of next year.

But can you talk about any milestones until then when you expect the next update from the European Commission and kind of what they look out for in terms of indications from the regulators?

Thanks, Hubert, for the question. I think we are now getting clearly into a phase where there's more continued work with the commission as well as some of the other regulatory authorities, the Bank of Spain and others.

So I don't think there is, in that sense, natural touch points until we've really more clarity on the overall timeline that will be certainly later in half year 2.

Just on the retail trading, which you mentioned in Securities Services, I was just wondering if this is a trend that you have been seeing in recent quarters? Is this something that has changed a little bit more dramatically in the first quarter given just the change in market dynamics?

And then also within Trading & Clearing, whether you're seeing, I guess, particularly in cash equities, but maybe in other areas as well, an increase in retail activity. And if you could provide any figures as to retail contribution either to volumes or revenue, that would be helpful.

Michael, thank you very much. We have been talking about the ascent of retail already over the last 2 or 3 years.

What I would really emphasize is the underlying change in some of what we have seen. While 2 or 3 years ago, we talked about or even in the COVID period, this was more this gaming-induced environment than international outreach.

That partly is still the case. But what we very much see is the growth of the ETF side and therefore, some of the structural drivers that will have a long-term momentum that are not at all volatility or single market-driven.

And that's something that we also see across the other sort of segments or that's what is driving cash markets. I think certainly, there is still a strong momentum when it comes to the structured retail products and some of those activities that not only feed the cash market, but feed across into our index business also.

So again, these retail-oriented structural drivers for us have, in particular, accelerated as we have increased our direct client access to many of the neo-brokers that work directly with us. That's the true accelerating factor, if I call it, and that's a very powerful trend where the teams have done fantastic work in tailoring our product and our proposition.

So we really have a pretty unique position there, and many of those players are going in astounding speed pan-European.

I just want to ask you, you touched on the kind of digitalization and tokenization journey. Maybe what are the key things that we should be watching for in the near term?

Are there any key announcements we should be looking out for and kind of how you're thinking about that revenue progressing and growing from here?

Thanks, Grace. It's an environment that continues to get transitioned from testing to reality running.

For us, the most important milestones is clearly a number of the initiatives that we're driving together with Kraken, or which is some of their linking into the Clearstream platform, which will allow collateral benefits. We also expect to make further progress around the stablecoin connectivity that we have announced with a number of partnerships in Q4 last week.

And last but not least, the digital instrument spectrum that we are handling on the Clearstream side, the next milestones will include the digital Eurobonds space. So I think with the recent announcements around joint data standards for the Eurobond on a digital basis is an important milestone to now really launch on the product side.

So those are three of the very tangible areas that are going forward.

Also two questions from my side, please. Touching again on the tokenization and digitization, it would be really great if you could elaborate a bit on the impetus, maybe, we see for the top line, the revenue growth here.

You mentioned the EUR 200 million investment in Kraken, I guess this partnership will drive a lot. But thinking about your own top line would be very interesting how you see that progressing over the next years to come?

And then secondly, on cost, you confirmed the underlying 3% cost growth. This quarter, we saw this Allfunds one-offs.

I was just wondering if there is some additional kind of investment/one-off costs that you could guide us maybe for the quarters to come.

Yes. Thank you very much.

So on the first question, I mean, as we're always saying, or leading the transformation strategy is building on current drivers until '28 and then we have 2 key long-term structural growth drivers beyond that one is Europe and the other one is really the whole new digital assets area. And -- so the answer to your question is while we do see revenues already now, these are on a rather moderate level, and we expect significant revenues beyond '28.

That's actually not a function of our own offering. It's a function of client uptake in the institutional space.

So we are preparing ourselves and we're going along with our clients here. On the second question, cost development, I think nothing to guide you beyond of what we mentioned this time.

So Allfunds has been a significant piece this time, and we continue to work on that, of course. But beyond that, I mean, we stand to our 3% cost items going forward.

I had just a couple, both around the theme of AI, please. I think in your prepared remarks, you said something along the lines of doing more with less on coding and software.

I think the comment was about Investment Management Solutions. But can you quantify at all what you've achieved in terms of efficiency gains or how you see the operating model in the future where -- versus where it has been historically, specifically with respect to the efficiency potential that comes about through AI.

That's question one. And secondly, we're getting sort of further into the implementation of AI in client workflows.

And where is IMS leveraging AI today to improve the client experience? Sort of where have you been able to introduce real changes that make the SimCorp Axioma product more valuable, please?

I think that would be really interesting.

I'll take the first one. So on AI impact.

So we do not separately quantify that, right? So we said that with respect to our strategy, we have 8% top line growth and 3% cost growth.

Those 3% cost growth have several drivers, right? I mean one is footprint.

One is just scaling across the existing platform. One is, you know, it's actually 4.

One is scaling the corporate center. And then the third one is actually AI.

So the answer to your question is AI is contributing to the 3% cost growth. And yes, that is actually a change to our historical path.

You will remember that historically, we have more grown the cost base by a magnitude of 5%. And now with the initial investments into the cloud space and basic infrastructure also now basic AI architecture and more global footprint through the acquisition of IMS and so forth, we are confident to manage this to a 3% level.

So that's essentially how we view it, and that's the target that we have.

With respect to the client workflow and the walk-through, there's actually been a very interesting session around that, and it may be online available at the SimCorp Global Summit. They did a walk-through the entire workflow process and the impact that AI will be having over time and what the implementation time lines and plans are when it comes to SimCorp One.

I think it starts on simple things like the chat box, the visualization, but we clearly now see, especially also in the optimization when it comes to the entire sort of middle office environment that there's progress made. So I think, again, it's a very comprehensive road map.

I think it's worthwhile looking it up in the context of the SimCorp material that is available.

One question regarding FX and digital assets, say, for modeling purposes, based on the volume development at 360T, which increased by 16% in Q1, if I'm right, I would have expected higher net revenue growth than 8% recorded in Q1? Are there any particular reasons for that?

That's my question.

So there's two things to keep in mind here. First of all, this business unit is FX and digital assets, right?

So it has both components, digital assets is negligible, but it is not contributing the growth level that you're seeing overall. So if you would back this out, then the underlying 360T growth level is higher.

It is double digit in the quarter. And the second one, apart from that, is product mix.

And if you put these two things together, then this can easily sync with the ADV volume increase.

I'd like to ask a question on the savings and investment union, please. It sounds like the push towards a single supervisor approach in Europe is gaining some momentum politically, including Germany.

I think there's some impetus to make progress with that and perhaps more broadly by the end of June and progress on a narrower basis or even enhanced cooperation if there isn't unanimous support. Could you maybe give us a sense of what the latest you're hearing around those processes, please?

Tom, thanks for the question. Happy to do that.

So as you mentioned, there's a number of themes where that the European regulatory oversight is pushed by the proposals from the commission. I think there is a clear openness to evaluate that much more than probably in the past.

I do believe that the milestones that are relevant to pass in the next few months is to find a cohesion. There's by far not all countries that are yet aligned around it but there was the initiative of the six countries that broke out, led by Germany and France that are very much wanting an in-depth analysis.

Now, for us, it really is an environment where we today already are working with ESMA in all the different areas. So it's not as though this would be totally new to us.

I think what we really hope for is that it results in a simplification that is not resulting in a further multi-layering. And I think that will be a strong advocacy.

We are going to push because there have been some numbers on build-out published around what ESMA expects in resourcing. And I think it shows this is something which we need to keep a dialogue on to keep it efficient.

And that will be our focus. So we are able to work with any setup that needs to remain as simple layered as possible.

I've got two left, please. One, a follow-up on Enrico's question on the €STR market.

So I mean, you made this comment on heightened competition in terms of winning the €STR market as it matures. I think my working assumption here is that it's not really in the interest in the market as a whole to have a bifurcation of liquidity on this.

And so over time, a market will really trend to one winner between you and ICE. So is the end state outcome here actually quite binary?

Is that how you're thinking of opportunity set here? If not anything I'm missing.

And then the second question, can we double-click on the Custody Revenues and Securities Services, I think a decent amount of the consensus revenue be here -- today came from here. Custody Revenues and Securities Services rose 13% year-over-year.

I think average AUC rose only 7%. I think some of this was collateral management revenues, but can you just remind us how custody product mix plays a role in this?

So happy to kick it off at least on, on the €STR point. I think your view is generally correct for many markets.

But in the particular case here, we see a different outcome, and that is really driven by our proposition as the home of yield curve. I think there are a number of clients for which we expect the benefits to operate on our platform will be very strong and that does not preclude that there still will be obviously a bigger part or a very material part of the liquidity that will stick to other sorts of venues.

And that's what we are pursuing. That's what we want to make sticky.

I think that's what our product road map is very much focused on to provide the cross margining and the collateral benefits across the different instruments. So from the long end to the short end as well as across to the OTC instruments.

So therefore, we still -- that's our view. I think on the Securities Services, I mean the mix between the Custody and Settlement Revenues and the growth there has been 13% on Custody and 24% on Settlement.

That shows the sort of very much the market environment, if you want. We've seen really exceptional days on the settlement.

The blend between the two is roughly 80% of the revenues. EUR 197 million was Custody and EUR 48 million was Settlement.

So I think that shows well the mix and also the limited exposure of some of the more recent spike of settlement goes away.

Maybe just only to build on that. So if you further would double click on custody, I mean, we're not providing transparency below that level.

But as you mentioned, repo and collateral management. I mean, these things, of course, did play a role, but also the -- if you wish, "core custody" business has also been growing similarly.

So there is not a single element within custody to highlight that business has just been developing nicely overall.

First of all index business, could you share some insight in the market expansion into the U.S., how is this progressing? Second, ESG business, could you distinguish a little bit regarding revenue momentum you see in the U.S.

and also towards the Asian and European time zones.

On the index side, I think we have seen a very good growth with 15%. You know, that really goes across the board, but has shown that the European markets continue to be attractive in terms of not just the new launches, but also on the existing instruments that are in the market, like structured retail products that use our indices, but also many clients on the buy side.

On the U.S., there is -- the next phase is really driven by our global buy-side family, which is going to be completed in the course of Q2. And then I think as you also know, index is not a short-term growth.

It's really a long-term client win business. And on the buy side in the U.S.

will be the starting point where we see good synergies in the overlap of the clients, where historically ISS has very strong footprint. So I think that U.S.

journey is certainly a way to go, and we will drive that as we progress on the product side. When it comes to ESG, as from the currency sensitivity that you have seen that Jens alluded to, I think it clearly is a dominantly U.S.

business. We see a much more solid growth, especially on the climate and many of the sort of true core ESG data points in Europe.

We also see more robustness in Europe on the corporate side which is a part of the governance. As you know, there is a corporate advisory as well as on the other side, an investor data business.

So I think that, again, is more robust in Europe. I think in aggregate, however, the basic story of longer sales cycle persists across the globe.

It's not uniquely tailored to the U.S.

Excellent. So, this completes the line of questions.

Thank you very much for your participation today. If you have any further questions, then please do feel free to reach out to us directly.

And thank you again, and have a good day.

Thank you.

Thanks.